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Economic Theories of Bundling and their Policy Implications in Abuse Cases: An Assessment in Light of the Microsoft Case

Author

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  • Kühn, Kai-Uwe
  • Stillman, Robert
  • ,

Abstract

Theories of bundling have had great importance in European competition policy in recent merger control and abuse of dominance cases. Prominent examples include GE/Honeywell, Tetra Laval/Sidel and the recent Microsoft decision. The European Commission has been heavily criticized in all of those cases. In this Paper we attempt to sketch how a systematic approach to bundling cases can be structured. We first provide an overview of existing bundling theories, concentrating on robust economic mechanisms and their empirical implications. This allows us to develop a number of clear criteria to identify potentially anticompetitive bundling. We show that a careful reading undermines recently proposed arguments for a (modified) per se legality rule for bundling.

Suggested Citation

  • Kühn, Kai-Uwe & Stillman, Robert & ,, 2004. "Economic Theories of Bundling and their Policy Implications in Abuse Cases: An Assessment in Light of the Microsoft Case," CEPR Discussion Papers 4756, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:4756
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    Cited by:

    1. Jeremy Grant & Damien J. Neven, 2005. "The Attempted Merger Between General Electric And Honeywell: A Case Study Of Transatlantic Conflict," Journal of Competition Law and Economics, Oxford University Press, vol. 1(3), pages 595-633.
    2. Duarte Brito & Margarida Catalão‐Lopes, 2010. "Mergers Of Producers Of Complements: How Autonomous Markets Change The Price Effects," Manchester School, University of Manchester, vol. 78(1), pages 60-75, January.

    More about this item

    Keywords

    Bundling; Efficiency defenses; Foreclosure; Policy rules;
    All these keywords.

    JEL classification:

    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices

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